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TMI Blog2025 (2) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... le 4(5) of the Merger Rules, 2022 clarifies that the services of the merged employees shall be governed by the concerned Service Rules governing the cadre. Rule 4(7) of the Merger Rules, 2022 plays a pivotal role in preserving and protecting the continuity of services of the petitioners. Hence their date of merger is being treated as the date of appointment in the related service cadre of Commercial Tax Department to maintain the continuity of service. It is clear that till framing of Merger Rules, 2022 the petitioners have no grievance as they continued to enjoy the service benefits as per the Uttar Pradesh Entertainment and Betting Tax (Gazetted) Service Rules, 1992. On account of Merger Rules, 2022, when they have been placed at the bottom of the seniority list in the respective cadres of the Commercial Tax Department as on 24.04.2018, they raised their grievance by means of the aforesaid writ petitions stating that the action taken by the State Government is hit by Article 14 of the Constitution of India. The only grievance raised before this Court is that the placement of the petitioners in the Commercial Department has caused prejudice. In this regard, reliance placed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which had accrued to the petitioners in the Entertainment and Betting Tax Department are liable to be granted in G.S.T. department on merger and they be promoted on the next higher post as and when the promotion falls due in the G.S.T. department. (4) The facts briefly stated are as follows:- (5) All the petitioners were previously governed under U.P. Entertainment and Betting Tax Act, 1979 [briefly, it is stated as 'Entertainment Tax Act'] and they joined their services in the said Department during the period 1996-1997 and until 2017, they were promoted to the next higher level posts. (6) On 01.07.2017, The U.P. Goods & Services Tax Act, 2017 [briefly, referred to as 'GST Act'] was promulgated and came into force with immediate effect. By virtue of the provisions of Section 174 of the GST Act, the Entertainment Tax Act was repealed alongwith some other Acts, therefore, the need for re-organization and merger of the officers/employees of Entertainment Tax Department on compatible posts in G.S.T. department arose. (7) Taking a considerate view to protect the services of the employees of the Entertainment and Betting Tax Department, the State Government took a policy decision t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the 'Substantive Appointment Date' for the employees of the erstwhile Entertainment Tax Department and it states that 'Substantive Appointment Date' means the date of appointment on the post held on notification dated 24.04.2018. (13) The aforesaid definition runs contrary to the definition of the substantive appointment as per the U.P. Government Servant Seniority Rules, 1991. Clause 4(h) of the U.P. Government Servant Seniority Rules, 1991 defines 'substantive appointment' as an appointment, not being an ad hoc appointment, on a post in the cadre of Service made after selection in accordance with the Service Rules relating to that service. It is submitted that while formulating the impugned Rules, 2022 the petitioners who have put in more than 20-25 years of service in the Entertainment Tax Department are being treated to be directly appointed in the Commercial Tax Department as on 24.04.2018. (14) It is submitted that the decision of not counting the past service rendered by the petitioners in their original cadre has no reasonable nexus to the object sought to be achieved by the impugned Rules, 2022, and therefore, the Merger Rules are completely arbitrary and unconstitu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ligible to be considered for promotion. (17) All the Assistant Commissioners in the erstwhile Entertainment Tax Department became qualified to be considered for promotion as per their own Rules, 1992 between 01.07.2021 to 01.07.2023, whereas if the impugned Rules, 2022 prevail then all of the petitioners and other Assistant Commissioners in the erstwhile Entertainment Tax Department will attain the age of superannuation before they can even complete their qualifying service of 7 years which is prescribed in the relevant Service Rules of Commercial Tax Department. The condition of all the Entertainment Tax Officers in Writ-A No. 3770 of 2023 in the erstwhile Entertainment Ax Department is almost the same. (18) It is further submitted that the State Government had sought an expert opinion from the Indian Institute of Management regarding cadre restructuring of the Commercial Tax Department. However, it proceeded to notify the impugned Rules, 2022 without considering the opinion of the Indian Institute of Management, Lucknow. (19) His further submission is that Rule 4(3)(2) of the impugned Rules, 2022 place the petitioners as junior-most in their year of recruitment which denies th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r affidavit of the petitioners. However, the respondents have not refuted the contents of paragraph 11 of the rejoinder affidavit of the petitioners. It is a settled proposition of law that in the absence of a specific denial to a pleading, it is considered as admitted. (23) Learned counsel for the petitioners has submitted that such classification is completely baseless and it achieves no purpose except for prejudicing the interest of employees of the erstwhile Entertainment Tax Department with respect to their promotion. Further, the impugned Rules, 2022 are unconstitutional as they provide for principles for determination of seniority of employees of the Entertainment Tax Department in contra distinction to the general principles as applicable to all government servants in the State of U.P. as per the U.P. Government Servant Seniority Rules, 1991. (24) On the other hand, learned counsel for the respondents have submitted that after enforcement of The Goods & Services Tax Act, 2017 on 01.07.2017, the State Government issued Government Order dated 24.04.2018 whereby the Entertainment and Betting Tax Department was abolished and all rights and duties of the Department were vested ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date when an employee is born into the cadre. This position has been crystallized by Hon'ble the Apex Court in the cases of Bihar State Electricity Board and others v. Dharamdeo Das [2024 (2) SLJ 498] and State of Uttar Pradesh and others v. Ashok Kumar Srivastava and another [(2014) 14 SCC 720]. Thus the submission of the learned counsel for the respondents is that looking at the administrative exigency and the aim of protecting the services of the petitioners, the date of merger notification was taken as 'Substantive Appointment Date'. (29) Further submission of learned Standing Counsel is that Rule 4(4) clearly states that after commencement of the Merger Rules, 2022, promotion and other service matters of related post shall be decided under the concerning Rules of service cadre of the Commercial Tax Department. The Rules governing the petitioners as of today are the Trade Tax Rules, 1983 as Merger Rules, 2022 is a onetime measure to protect the service of the petitioners and not special Service Rules for them and Rule 4(5) of the Merger Rules, 2022 clarifies the submission of the State that the services of the merged employees will be governed by the concerned Service Rules go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16 31.01.2025 2. Piyush Kumar Yadav 01.08.1997 25.10.2016 30.1.2029 3. Kalpana Kannaujia 04.07.1997 02.11.2016 30.04.2027 (34) The details of petitioners of Writ-A No. 3769 of 2023 are given hereunder:- Sl. No. Name of the petitioner Date of joining in the department Date of promotion as Entertainment Tax Officer Date of promotion as Assistant Commissioner Date of retirement 1. Roshan Lal 22.11.1996 09.04.2015 01.07.2020 31.03.2025 2. Prabhat Chaudhary 13.06.1997 04.01.2016 01.07.2020 30.04.2028 3. Sursh Chandra Singh Bisen 31.07.1997 04.01.2016 01.01.2021 31.01.2027 (35) Since the matter revolves around the provisions of Section 174 in The U.P. Goods and Services Tax Act, 2017, it is necessary to reproduce it as under:- "174. Repeal and saving (1) Save as otherwise provided in this Act, on and from the date of Commencement of this Act, (i) The Uttar Pradesh Value Added Tax Act, 2008, except in respect of goods included in the Entry 54 of the State List of the Seventh Schedule to the Constitution, (ii) The Uttar Pradesh Tax on Entry of goods into local areas Act, 2007 (iii) The Uttar Pradesh Entertainment and Betting Tax Act, 1979 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice on behalf of respondents has been accepted by the office of learned Chief Standing Counsel. Considering the imminent problem being faced by the petitioners who prior to their merger in the Commercial Tax Department were working in the Entertainment Tax Department, in relation to their promotional avenues, we direct that the respondents shall file their counter affidavit within a period of six weeks. We expect that within the time being stipulated herein, respondents shall file counter affidavit considering the urgency in the matter." (39) Pursuant to the order dated 19.05.2023, the State Government has filed its counter affidavit wherein the respondents have asserted that only the employees of the Entertainment Tax Department have been merged into the Commercial Tax Department and not the posts of the Entertainment Tax Department. (40) Furthermore, in order to satisfy the query of this Court, instructions dated 24.10.2024 were placed before this Court wherein the exact number of posts available in the year 2018 and 2024 were stated. Thus, a bare perusal of the instructions dated 24.10.2024 would demonstrate that not a single post has been increased in the Commercial Tax Dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of argument, if the petitioners had been retrenched from the erstwhile department in view of repeal of the Act, on coming into force of U.P. G.S.T. Act, 2017, their fate would be in dilemma. Instead, the State Government took a conscious decision to merge all the employees of the Entertainment & Betting Tax Department into the Commercial Tax Department. (45) Although the reasons for placement of the employees of the Entertainment and Betting Tax Department junior to the Commercial Tax employees in the service year has been mentioned above, but the placement of the petitioners in the Merger Rules, 2022 is a part of policy decision and the petitioners have no locus to question the policy decision taken by the State Government. (46) The only grievance raised before this Court is that the placement of the petitioners in the Commercial Department has caused prejudice. In this regard, reliance placed by the learned counsel for the respondents on Indian Airlines Officers' Assn. v. Indian Airlines Ltd. and others & other connected appeals [(2007) 10 SCC 684] is fully applicable as it has been held that the whole scheme cannot be said to be arbitrary/discriminatory merely because some emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out by the court until other ombudsman arrangements -- a problem with which Parliament has been wrestling for too long -- emerges. I have dwelt at a little length on this policy aspect and the court process because the learned Attorney-General challenged the petitioner's locus standi either qua worker or qua citizen to question in court the wrongdoings of the public sector although he maintained that what had been done by the Corporation was both bona fide and correct. We certainly agree that judicial interference with the administration cannot be meticulous in our Montesquien system of separation of powers. The court cannot usurp or abdicate, and the parameters of judicial review must be clearly defined and never exceeded. If the Directorate of a government company has acted fairly, even if it has faltered in its wisdom, the court cannot, as a super-auditor, take the Board of Directors to task. This function is limited to testing whether the administrative action has been fair and free from the taint of unreasonableness and has substantially complied with the norms of procedure set for it by rules of public administration." (51) In Directorate of Film Festivals & Ors. v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Puliyel v. Union of India and Ors., 2022 SCC OnLine SC 533, though the Supreme Court was broadly examining policy decisions pertaining to health, it had observed that in exercise of their judicial review, Courts should not ordinarily interfere with the policy decisions of the Executive unless the policy can be faulted on grounds of mala fide, unreasonableness, arbitrariness or unfairness, etc. The relevant portion of the judgment stating the same is as under:- "21. We shall now proceed to analyse the precedents of this Court on the ambit of judicial review of public policies relating to health. It is well settled that the Courts, in exercise of their power of judicial review, do not ordinarily interfere with the policy decisions of the executive unless the policy can be faulted on grounds of mala fide, unreasonableness, arbitrariness or unfairness etc. Indeed, arbitrariness, irrationality, perversity and mala fide will render the policy unconstitutional. It is neither within the domain of the courts nor the scope of judicial review to embark upon an enquiry as to whether a particular public policy is wise or whether better public policy can be evolved. Nor are the courts inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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